Export aid sustained a cut in the new state budget and a federal agency that helps finance foreign commerce faces a threat to its existence.

The $29 billion state budget enacted in June cuts export assistance by 20 percent to $5.8 million.

“We have been cut in some way, shape or form for the last three years,” said Michael Horvath, international business development manager at the NEPA Alliance, a Pittston-based economic development agency. “You can only cut so much until things start to unfold.”

Pennsylvania companies registered $40.9 billion in 2013 overseas sales, according to the U.S. Department of Commerce. Regional exports total $1.4 billion in 2012, the most-recent government data show.

In Washington, D.C., meanwhile, the charter of the Export-Import Bank expires Sept. 30 and some Republican lawmakers oppose its extension. The bank, which helps foreign buyers purchase U.S. goods, reported it has assisted 250 state companies record $6 billion in foreign sales since 2007.

“The Export-Import Bank helps businesses, particularly manufacturers, across Pennsylvania sell products around the world, creating jobs in the commonwealth,” said U.S. Sen. Bob Casey, a Scranton Democrat who supports extension of the bank’s charter. “Congress should quickly move to reauthorize the Ex-Im bank so that it can continue its work connecting our region’s small businesses with new markets.”

State assistance helps exporting companies cover travel expenses and make foreign business contacts. The Ex-Im Bank helps exporters obtain financing that might not be available otherwise.

The impact of the state budget cut on export aid has not been determined, said Lyndsay Kensinger, a spokeswoman for the Department of Community and Economic Development.

“DCED is currently evaluating the budget as it relates to the department’s efforts moving forward,” she said.

Mr. Horvath said grants helping defray travel expenses may be phased out and there may be fewer foreign trade advisers available to help state companies make overseas business contacts.

“How they are going to balance everything, we’ll just have to wait and see,” he said. “There’s going to be some losses whatever way you look at it.”

Doug Batzel, president of Batzel Consulting, a Madison Twp. firm that provides products and services to the oil and natural gas pipeline industry, said a state travel grant years ago enabled him to attend a conference in Scotland that introduced him to exporting.

“That planted the seed for all of this,” he said. “It’s one thing that shouldn’t be cut.”

He also worries about potential impact on the state’s overseas network of trade representatives, who provide direction and advice on business contacts.

“The stuff that would take me years to figure out, I would get done quickly by a trade rep,” Mr. Batzel said.

The Ex-Im Bank assists more than 160 small businesses in Pennsylvania, including Loh Medical, a Clarks Summit exporter of durable medical equipment to Latin American and Caribbean nations.

The company turned to the Ex-Im Bank after it had difficulty obtaining bank financing because all its income comes from exporting, company President Perry Loh said.

“Essentially, we did not have access to local credit,” he said.

Loh Medical buys insurance from the bank, he said, which provides coverage for 95 percent of its receivables, and banks are more receptive to requests for financing.

“There is less risk for them,” he said. “It’s the only way I’ve found to have access to commercial credit.”

The company has expanded to six local employees and 12 in South America, partly because of Ex-Im Bank involvement, Mr. Loh said.

“That was really important for our growth,” he said. “I would like to see that program continue.”

Contact the writer: jhaggerty@timesshamrock.com

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